You own a stock portfolio invested 35 percent in Stock Q, 30 percent in Stock R,

Question

You own a stock portfolio invested 35 percent in Stock Q, 30 percent in Stock R, 20 percent in Stock S, and 15 percent in Stock T. The betas for these four stocks are .79, 1.17, 1.18, and 1.35, respectively. What is the portfolio beta? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

You own a stock portfolio invested 35 percent in Stock Q, 30 percent in Stock R, 20 percent in Stock S, and 15 percent in Stock T. The betas for these four stocks are .79, 1.17, 1.18, and 1.35, respectively. What is the portfolio beta? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Explanation / Answer

company Weights in portfolio beta Weighted beta Q                              0.350 0.79 0.277 R                              0.300 1.17 0.351 S                              0.200 1.18 0.236 T                              0.150 1.35 0.203 Total                              1.000 Beta of the portfolio, 1.066

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